City Council considers pulling neighborhood support work from IIN

For almost three decades, Invest in Neighborhoods Inc. (IIN) has overseen how taxpayer money is distributed to Cincinnati’s neighborhood groups, doling out hundreds of thousands of dollars to areas ranging from Avondale to Winton Place and all points in between.

But that role might soon come to an end amid allegations about the organization’s slippery business practices and secretive decision-making process.

IIN is facing growing criticism from its main funding source, Cincinnati City Council, as well as some neighborhood activists who say the organization’s executive committee is ruled by a small group of insiders who keep power by changing the rules as they see fit and spreading misinformation whenever their authority is questioned.

“You learn early on there’s an inner circle that runs everything,” says Maureen Mello, a Paddock Hills resident who served on IIN’s 17-member Board of Trustees until she and six others were ousted last June. She says the process used to force them off the board violated IIN’s own code of ethics and other rules.

West End resident Dave Petersen, another ousted board member, adds, “They are unethical and do not follow a democratic process, and their communications are dishonest.”

Mello and Petersen were part of a faction that voted 9-8 last year to hire a new executive director for IIN, responding to criticisms by City Council and their own observations about how the firm operated.

Those in the minority who wanted to keep the current director instead called for a general membership meeting. At that meeting, where about 34 people attended, the hiring decision was overturned and the board members who pushed for the new director were removed. Before the ouster, they weren’t allowed to speak on their own behalf.

In all, seven members were removed from IIN’s Board of Trustees and another three members resigned in protest over what had occurred — meaning 59 percent of the board was replaced in the dispute.

Those who remain at IIN downplay the turmoil.

“What’s happened is you have a bunch of sour grapes,” says Rick Dieringer, the IIN executive director who was allowed to keep his job. Referring to the board’s turnover, he says, “The hiring was just one of the issues. There was a general sense that those board members weren’t acting in the best interests of the members.”

It’s not only those ousted members who are concerned about IIN’s operations.

For at least the past two years, the firm also has had a rocky relationship with City Council, which became concerned that the organization was ignoring mandates to improve its public participation and communication. Also, some council members say IIN was becoming improperly involved with political lobbying at City Hall in an effort to block proposals that might threaten the organization’s dominant role in shaping neighborhood development.

In October 2006, a five-member majority on City Council wrote a scathing letter to IIN’s Board of Trustees, demanding changes.

“We are not going to continue to support an agency who has minimal performance at best, strays from its contracted mission, ignores city laws, engages in political activities, and is dishonest in its communications,” the letter stated.

City Council members who signed the letter were Democrats Jeff Berding and John Cranley, Republican Leslie Ghiz and Charterites Chris Bortz and Jim Tarbell.

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Cranley and Tarbell have since left council.Council’s complaints against IIN included:

* Refusing to implement a universal set of bylaws to govern all of the city’s neighborhood groups;* Continuing to disburse money to a neighborhood group that had violated city law;* Ignoring complaints from residents about certain activities by neighborhood groups and not keeping contact information up-to-date on its Web site;* Lobbying neighborhood groups to oppose a proposal by some city council members, nicknamed “2CDC,” that would have created a new agency to do some development projects; and* Incurring added expense to audit IIN’s records after it was revealed the firm’s previous executive director, Gerald Tenbosch, faced criminal charges for allegedly embezzling $70,000 from the Finneytown Athletic Association while still employed by IIN.

In response to the concerns, IIN inducted a new slate of members to its Board of Trustees in 2007 to give it fresh blood, and the board held an executive retreat to hash out problems. Many of those new board members were the ones subsequently ousted in June 2008.

The simmering dispute culminated last December, when City Council approved a municipal budget for 2009 that called for pulling one of its two prime contracts with IIN, which had allowed the group to administer Cincinnati’s Neighborhood Support Program at a cost of $112,800 per year.

Under the program, each of Cincinnati’s 51 neighborhoods is eligible to receive $7,000 annually from the city for qualifying projects. A similar but separate program provides up to $9,000 each year to the city’s 34 neighborhood business districts.

To help ensure the money was spent properly over the years, the city began contracting with the non-profit IIN in the early 1980s. The firm disburses funds and provides educational and technical assistance to the neighborhood groups, including leadership development to help residents become more effective in dealing with City Hall.

But council decided this winter that the function could be done more cheaply and effectively in-house by the city’s Community Development and Planning Department. About $50,000 was earmarked for the department’s budget to do the work.

Departmental staffers, though, complained that the switch didn’t leave the city enough time to draft new contracts with individual neighborhood groups so they could bypass IIN. Further, they said ending the contract immediately might jeopardize the yearly Neighborhood Summit, scheduled for Saturday at Xavier University.

As a result, IIN’s contract was extended for 60 days and now is slated to expire in March.

Meanwhile, IIN’s Dieringer has privately lobbied City Council to reconsider and extend the contract for the rest of 2009. At least four members — Vice Mayor David Crowley, Councilwomen Laketa Cole and Roxanne Qualls and Councilman Cecil Thomas — have signed a motion to do just that, but they need one more vote.

“What they want, to do all this work in-house, just isn’t going to be practical in two months,” Crowley says. “We want to give it to (IIN) for the entire year, and we can discuss other options in the meantime.”

The proposed turnabout irritates Bortz, who said it violates the hard-fought budget deal negotiated by council.

“We set the budget, now let’s make it work,” he says. “Let’s not try to come and undo it after the fact.”

The contract extension is tentatively set to go before City Council’s finance committee on Monday.

Dieringer says the city can’t perform the work in-house for just $50,000 and that the actual cost would be in excess of $100,000, negating any potential savings.

Bortz, however, disputes that point. Although the city would have to draft about 80 contracts to accommodate the switch, it would be a one-time expense and most of those contracts would contain identical or similar wording.

“This is a city function,” Bortz says. “The community councils are a creation of the city government. It boggles the mind that we couldn’t do it internally. Most of the people who I’ve heard want to maintain the contract the way it is work either directly or indirectly for (IIN).”